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Your company is thinking about acquiring another corporation. You have two choices the cost of each choice is $250,000. You cannot spend more than that, so acquiring both corporations is not an option.The following are your critical data:Revenues = $100,000 in year one, increasing by 10% each yearExpenses = $20,000 in year one, increasing by 15% each yearDepreciation expense = $5,000 each yearTax rate = 25%Discount rate = 10%Corporation BRevenues = $150,000 in year one, increasing by 8% each yearExpenses = $60,000 in year one, increasing by 10% each yearDepreciation expense = $10,000 each yearTax rate = 25%Discount rate = 11%Compute and analyze items (a) through (d) using a Microsoft® Excel® spreadsheet. Make sure all calculations can be seen in the background of the applicable spreadsheet cells. In other words, leave an audit trail so others can see how you arrived at your calculations and analysis. Items (a) through (d) should be submitted in Microsoft® Excel®; indicate your recommendation (e) in the Microsoft® Excel® spreadsheet; the paper stated in item (f) should be submitted consistent with APA guidelines.a.A 5-year projected income statementb.A 5-year projected cash flowc.Net present value (NPV)d.Internal rate of return (IRR)e.Based on items (a) through (d), which company would you recommend acquiring?
Compare your findings in parts a.1. and a.2. All else being identical, which type of annuity-ordinary or annuity due-is preferable? Explain why.
Valuation Principle Problems: Suppose that Bondi Inc. is a holding company that owns both Pizza Hut and Kentucky Fried Chicken Franchised Restaurants. If the value of Bondi is $130 million, and the Pizza Hut Franchises are worth $70 million, then wha..
Computation of current price of share and find What is the current price and What will be the price in three years
An investor has two bonds in his or her portfolio, Bond C and Z. Each matures in four years, has a face value of $1,000, and has a yield to maturity of 9.6%.
Make a 700-1,050-word paper in which you discuss how annuities affect TVM problems and investment outcomes. In your paper, be sure to address the impact of the following items on TVM:
In March 2005, General Electric had a book value of equity of $113 billion, 10.6 billion shares outstanding, and a market price of $36 per share.
Suppose the exchange rate between British pounds and U.S dollars is $1.35 per pound. What is the correct way to write this pound-dollar exchange? The dollar-pound exchange rate?
what is the amount of free trade credit that langley obtains from Consolidated Services?(assume 360 days per year throughout this problem)
An automobile company, Nissan, as temporary cash surplus and lends its funds overnight through a repurchase agreement to a government securities dealer, earning $55,600 in interest income when RP loan rate stood at 5.70%.
A student borrows $4000 for tuition to be paid back at a simple interest rate of 5% in 6 months. How much does he pay back in 6 months?
Assume a bank has $5 million in deposits and $1 million in vault cash. If the bank holds $1 million in excess reserves and the required reserves ratio is 8 percent, what level of deposits are being held?
Compute the amount of the bonus payable to the employees at year-end.
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